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Dec. 21, 1998

Inside The
Hunt For Osama

The Feds have tailed the Saudi and his secret
network for years. So why didn't they stop the Africa bombings?

BYDOUGLAS WALLER/WASHINGTON

The exercise was code-named Poised
Response. Attorney General Janet Reno had invited 200 policemen from the
Washington metropolitan area to the FBI's headquarters last Oct. 14 to
plan how they'd react to a terrorist attack in the nation's capital. They
settled in that Wednesday morning to consider four scenarios: a car-bomb
attack, a chemical-weapons strike on a Washington Redskins football game,
the planting of an explosive device in a federal building and an
assassination attempt on Madeleine Albright, the Secretary of State. But
the war game--intended to help the agencies practice working
together--quickly melted down into interagency squabbling and finger
pointing.

Reno left the session feeling
uneasy--understandably so, say Administration officials. Poised Response
was anything but poised. And while the cops involved were never told
which terrorist might carry out such an audacious attack, Reno and other
top Administration aides had one man in mind: Osama bin Laden, whose
Afghan camp had been blasted by U.S. cruise missiles two months earlier.
His operatives might be coming to town soon. Intelligence sources tell
TIME they have evidence that bin Laden may be planning his boldest move
yet--a strike on Washington or possibly New York City in an
eye-for-an-eye retaliation. "We've hit his headquarters, now he hits
ours," says a State Department aide.

The hand-wringing and brainstorming are
part of what Albright calls "the war of the future"--a battle
in which the foot soldiers are elusive terrorists and the agents are in
pursuit. The enemy in this case is a 41-year-old Goldfinger with a bank
account of $100 million to $300 million, a far-flung network of cohorts
and a fiery hatred for the U.S., which he badly wants out of Saudi Arabia,
his homeland. The bloodiest round of this new war came on Aug. 7 when bin
Laden's agents allegedly bombed U.S. embassies in Kenya and Tanzania,
killing 224 people, 12 of them Americans.

Those simultaneous attacks were the most
devastating terror assault the U.S. has suffered overseas since the
bombing of the Marine barracks in Beirut in 1983. Though Washington
retaliated 13 days later, with cruise-missile strikes at Osama's base in
Afghanistan, U.S. officials are still licking their wounds. The bin Laden
attacks came despite a four-year secret campaign by the U.S. government
to contain and control his activities--a frustrating war of attrition in
which Washington has both won and lost battles. American agents have
tracked, arrested and interrogated members of Osama's terror cells in
dozens of countries. Now two government inquiries--one by the CIA's
inspector general, the other by a State Department Accountability Review
Board--have begun to raise a troubling question: Could the East Africa
attacks have been prevented?

The targeting of Osama's network began in
earnest almost two years after the 1993 World Trade Center bombing, which
killed six people and injured more than 1,000. On a chilly, clear
February night in 1995, a helicopter soared over the Hudson River to the
FBI's office at New York City's Federal Plaza. Sitting blindfolded in the
chopper next to the bureau's Lewis Schiliro was Ramzi Yousef, the
mastermind of the Trade Center attack, who had just been nabbed in
Pakistan. During the transatlantic leg of the flight back to the U.S.,
Yousef had bragged that his original plan had been to plant enough
explosives in one of the 110-story twin buildings to topple it, killing
maybe 250,000 people in the tower and on the ground. But his shoestring
operation couldn't afford enough dynamite, and settled for a much smaller
blast.

As the chopper neared the Trade Center,
agents removed Yousef's blindfold. "See?" said one. "It's
still standing." Yousef squinted at the high-rise. "Next time,
if I have more money," he finally said, "I'll knock it
down."

Schiliro, who's now running the FBI's
investigation of the Africa bombings, remembers feeling a chill run
through his body. His fellow agents had already discovered that the
terrorist now had the cash to back up his threat. Yousef apparently had a
benefactor, a wealthy Saudi expatriate named Osama bin Laden, who in the
1980s had bankrolled mujahedin guerrillas fighting the Soviets in
Afghanistan and who had fled his Saudi homeland after he had been charged
with inciting fundamentalist opposition to the country's royal family.

Until then, the FBI and the CIA considered
bin Laden, son of a Saudi construction magnate, to be a "Gucci
terrorist" with a fat wallet and a big mouth. His followers were a
loosely bound group of former Afghan freedom fighters called al Qaeda,
meaning (military) base. But bin Laden was moving into the big leagues.
Al Qaeda operatives or sympathizers are accused of attacking American
soldiers in Somalia, Yemen and Saudi Arabia. They had plans to kidnap
U.S. military personnel in the Persian Gulf, and they might have
U.S.-made Stinger missiles left over from the Afghan war. Worse,
intelligence officials discovered that by 1993 bin Laden had begun
hunting for nuclear weapons. First on his shopping list was a Russian
nuclear warhead he hoped to buy on the black market. He abandoned that
effort when no warhead could be found. Instead, his agents began scouring
former Soviet republics for enriched uranium and weapons components that
could be used to set off the fuel.

Fortunately, "Osama's buyers weren't
physicists, and the people selling to him were trying to rip him
off," says an Energy Department official. The enriched uranium they
were offered turned out to be low-grade reactor fuel unusable for a weapon.
Another con man tried to sell them radioactive garbage, claiming it was
"red mercury," a supposedly lethal Russian bomb the CIA says
never existed. Frustrated, bin Laden instead settled on chemical weapons,
which are easier to manufacture. Although U.S. intelligence officials
have been unable to pinpoint hidden caches, they suspect that during a
five-year stay in Sudan before moving to Afghanistan in 1996, bin Laden
tested, with the help of Sudanese officials, nerve agents that would be
dispensed from bombs or artillery shells.

By the end of 1995 President Clinton signed
a top-secret order, approved by the congressional intelligence
committees, that authorized the CIA to begin covert operations to break
up bin Laden's terror network. The agency's counterterrorism center--200
operatives housed in a windowless warren of cubicles in the CIA's
Langley, Va., headquarters--had set up a special bin Laden task force.
Analysts were assigned to read every word the Saudi had spoken or
written. Computers with sophisticated "link analysis" programs
were busy printing out diagrams of bin Laden's loose-knit network, which
included thousands of Muslim fighters with varying degrees of allegiance
to him in almost a dozen countries. In early 1996, intelligence sources
tell TIME, the CIA also began making plans to "snatch" Osama
from a foreign country and bring him to the U.S. for trial. But bin Laden
avoided some of the nations where the U.S. was waiting to
pounce--including Qatar and Kuwait.

With bin Laden out of reach, the CIA
launched a secret program to harass his network. Using its own informants
plus the counterterrorism center's computers, which tracks passports
worldwide, the CIA would spot bin Laden operatives in foreign countries,
then quietly enlist the local security service to arrest or deport them
and allow the agency to sift through materials left in their apartments.
In many cases, the CIA didn't know "exactly what each person was
doing," says an intelligence official, "just that he was doing
something with a terror organization, so we should disrupt it."

One operation would produce clues that led
to another. For example, a CIA analyst perusing a slip of paper scooped
up in one raid realized that scribbled on it was part of a phone number
for a bin Laden cell in another country. That cell became the next target
and yielded another round of evidence.

The CIA had a similar "disruption
operation" under way in Kenya a year before the bombing. The
agency's station in Nairobi is one of the busiest in Africa, responsible
for keeping watch as well on the war-torn countries of Somalia, Sudan,
Rwanda and the Democratic Republic of Congo. In Kenya, CIA and embassy
security officers believed the biggest threat to Americans was common
crime. But the risk of terror lurked below the surface. Nairobi had
become a transit stop for Iranian and Sudanese intelligence agents. Along
the country's Indian Ocean coast were Kenyan veterans of the Afghan war
that bin Laden agents had been recruiting.

By August 1997 the CIA had identified a bin
Laden cell operating in Nairobi. The agency believed it was headed by
Wadih el Hage, a Lebanese who held American citizenship and who,
according to court documents, once served as bin Laden's personal
secretary. Washington sent a secret request to Kenyan authorities in
Nairobi: roust Wadih el Hage. For several weeks Kenyan police, sometimes
accompanied by visiting FBI agents, began paying visits to el Hage's
Nairobi home, searching its rooms, confiscating computer disks and darkly
warning him that he'd face more hassling if he remained in the country.

The raids never uncovered a list of
operatives in the cell but did rattle many of the members. One typed on
el Hage's computer a "security report" to a senior bin Laden
aide complaining that "the cell is at 100% danger" because of
hostile intelligence agencies. FBI agents believe the report's author was
Abdullah Mohammed Fazul, whom the CIA at the time had identified only as
a distant associate of el Hage's. He was later accused of being a key
planner of the embassy bombings the next year. El Hage moved with his
family to Texas, where he lived and worked as a tire repairman until he
was charged this fall with conspiracy in the Africa bombings.

Meanwhile, the CIA station conducted
another covert operation in Kenya. It was prompted by a tipster who
walked into the Nairobi embassy in September 1997 and claimed that seven
Arabs who worked for a local Islamic charity had connections with a bin
Laden terror group. The agency confirmed that there were indirect ties,
so Kenyan authorities deported the men to their home countries, and CIA
officers began sifting through all the documents left behind.

State Department officials now question
whether the CIA missed clues to a future attack in those papers.
Intelligence officials insist that none of the evidence taken revealed a
bombing plot. Bin Laden definitely had a cell in Nairobi, the CIA
reported to the embassy at the time, but the agency had no idea what he
planned to do with it. Bin Laden had made plenty of public threats
against the U.S., but the CIA believed he would be most likely to carry
them out in Persian Gulf countries, where there was a U.S. military
presence he hated, not in East Africa.

Two months later, in November 1997, another
informant walked into the Nairobi embassy. He was Mustafa Mahmoud Said
Ahmed, an Egyptian, who warned that unnamed terrorists planned to car
bomb the compound. Ahmed had details about the planned attack--details
that would end up being eerily similar to what happened in the bombing
nine months later. (He is under arrest in Dar es Salaam, accused in the
Tanzania embassy blast.)

CIA officers grilled Ahmed for days but
finally concluded he was making up the tale. If an informant is credible,
the agency often dispatches a special countersurveillance unit, nicknamed
the snapshot team, which will sit in the embassy, wearing night-vision
goggles from dusk to dawn, and peer out windows to spot terrorists casing
the building. No snapshot team was dispatched to Nairobi. Instead, the
station sent out another warning report: Ahmed is probably fabricating
the story, but he could be telling the truth, or he could be approaching
the embassy to check its security.

It was the kind of report embassy security
officers detest. A warning that tells you everything and nothing.
Nevertheless, extra guards were posted at the front and back of the
building, and nervous security officers convinced their ambassador,
Prudence Bushnell, to fire off a letter to Albright warning that the
embassy was vulnerable to car bombs. But Nairobi's remained low on the
priority list of embassies due for major security upgrades.

For the next nine months, East Africa went
off the intelligence radar screen. No more CIA reports of terror threats
were delivered to the Nairobi embassy. In hindsight, it was probably a
tip-off that something bad might happen. Terror cells go quiet before
they attack. The CIA thought it had busted up the bin Laden cell, but
during the silent period, "the B-team came in," says a U.S.
intelligence official. Mohamed Rashed Daoud al-'Owhali and Mohamed Sadeek
Odeh, trained in explosives at a bin Laden camp, eventually joined Fazul
in Nairobi to organize the strike.

The CIA was battling bin Laden on
additional fronts. In the spring of 1998, a small CIA-FBI team collected
intelligence on him by parking itself at what agents call the "zero
line," Pakistan's border with Afghanistan. Back at Langley, CIA and
Army special-operations officers drafted contingency plans for commandos
to fight their way into Afghanistan for a snatch. CIA director George
Tenet nixed the operation, fearing too many U.S. casualties. But in June
the agency scored a win. CIA officers working with Albanian police
grabbed four members of a bin Laden-affiliated group, the Egyptian Islamic
Jihad, who planned to bomb the U.S. embassy in Tirana.

It was before sunrise in Langley on Aug. 7
when the bombs went off in Africa. Within hours of the blast, the CIA's
counter-terrorism officers began crowding into their "fusion
center," a small room used to monitor terror crises overseas that is
crammed with computers and large screens displaying satellite photos. The
carpet still had burn marks from the time an excited Tenet dropped his
cigar upon learning that CIA officers had apprehended Mir Amal Kasi, who
had murdered two agency employees outside Langley. Tension was high as
early casualty figures flowed in from Africa. Almost immediately, the CIA
officers had a good idea who triggered the explosions at Nairobi and Dar
es Salaam. The bin Laden cell. The covert operation the year before
apparently had not cleaned out that nest of terrorists.

The conclusion hardened within days. The
FBI took Odeh and al-'Owhali into custody in Nairobi, and they began
spilling secrets. The security protecting bin Laden's network was porous,
and other informants began talking, revealing that bin Laden planned
assaults on other U.S. embassies in Africa, Asia and the Middle East.

Though the U.S. soon flexed its military
muscle with the cruise-missile strike against bin Laden, and his network
has been quiet for four months, Washington still sees him as a major
threat. The White House has ordered stepped-up efforts to disrupt the
terror network, but with mixed results. Treasury Department officials
have made no headway dismantling bin Laden's financial empire. Most of
his investments are in European or African companies that are unaffected
by U.S. economic sanctions and don't deal in dollars, which Treasury
could track. The State Department, likewise, has not convinced Afghanistan's
ruling Taliban to evict bin Laden so the FBI can get its hands on him.

The Pentagon is still looking at targets to
hit, and the CIA continues covert operations to trip up bin Laden
operatives. His aides have recently been arrested in Britain and Germany.
Three months ago, intelligence sources tell TIME, the CIA broke up a bin
Laden ring that had been planning an attack on the U.S. embassy in Baku,
Azerbaijan. Egyptian terrorists identified in the plot were deported to
Cairo.

Washington remains sure that bin Laden will
strike back. And when he draws blood again, all the past covert
operations will be deemed failures because they did not prevent the
latest attack. In the calculus of terrorism, the last side to show its
fangs becomes the victor for the moment. "The game is tilted in
Osama's favor until he's gone," admits a White House aide.
"That's the problem we face." If so, this may be a war--for
now--without end.

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